Debt is emotional, stressful, and exhausting. Learn the emotional stages of debt so that you can take action.
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We all experience life events that cause us stress: the death of a parent, divorce, moving, health issues, and job loss. The events I just listed are common. We talk about them. We get sympathy and support. And this emotional support helps us to heal and work through this pain.
Debt is a huge cause of stress. Yet, it is something that most carry alone. You can tell a friend about a health issue causing stress and get sympathy and even some helpful advice. But you might be less likely to talk about the $20,000 in credit card debt that is keeping you up at night. You might feel ashamed. And depending on the friend, you might not get a sympathetic ear.
We must talk about the emotion of debt. Talking about debt plays a critical role in dealing with the stress of a financial crisis. It helps you heal. It helps you move on.
We also must be confident enough to ask for help and advice when we need it. The more we understand the debt reduction options available, the less confusion we have. We realize that things are never quite as bad as they seem.
Like all highly charged emotional events, we see distinct patterns during a financial crisis.
This is always first stage of dealing with any negative situation and debt is no different.
Some common thoughts are “Things will turn around, I just need to make it through until my tax return comes in,” “I will get more overtime at work,” “It’s only a couple of payments we’ve missed.”
We stop opening the mail and answering the phone from unknown numbers. We stop going online as much to check account balances and even switch bank accounts so we don’t have to look at the credit card balances.
What we do know is that the calls and the letters mean someone wants paying and they aren’t going away.
Take action:
It’s easier said than done, but this isn’t the time to bury your head in the sand. It’s time to open the letters, answer the calls and go online so you can create a full financial review and see exactly where you stand.
You know there are problems, but what you don’t know is that there are always solutions if you get the right help. The sooner you ask for professional help, the sooner you can begin to resolve the situation and things will become much less daunting.
The stage that follows denial is often that of anger. There is always someone or something we can look to blame. The situation you are in is very likely due to circumstances that may in part have been out of your control.
Financial hardship is rarely due to complete neglect and frivolous spending and behavior. It can be from poor financial decisions, lack of financial literacy, or simply trying to survive after a financial crisis or loss of income.
Becoming accountable is a hard step, but it’s always a first step in the right direction. Anger is a wasted emotion that will destroy relationships and push family and friends away when you need them the most. It is very common to blame a spouse for the situation you are in, but the energy consumed can be better used in finding a solution to your money worries.
Take action:
Anger won’t change the situation and it won’t make the debt go away. It will only make the process more painful and take longer to rectify.
Instead of dwelling on anger and ‘what could have been’ accept the reality. Reframe this life event as a lesson. The value of this crisis is that you can use it as a powerful reminder to never get in this situation again. Accept the situation. Internalize the lessons. Move forward.
Not everyone will experience this and many will move past anger straight to acceptance.
Depression is the hardest stage to deal with and the most damaging. A financial crisis is a situation no one ever expects to find themselves in. If you become isolated and embarrassed to talk about it can quickly become overwhelming.
Take action:
It takes a great deal of strength and courage to get through this, but you will get through it. It may seem like this situation is the end of the world, but financial situations can be reversed and you need to truly focus on the things that are important to you.
Seek professional medical help. Talk to friends about your emotions. And know that many people have stood where you stand and have gone on to rebuild their financial lives and find comfort again.
Acceptance is the first stage of turning the corner. Things will take time, but as soon as you start looking at the possible solutions you will see that a resolution is possible.
It’s going to take work and commitment and you will need to be completely open minded to all the options available. Do your research so you don’t just settle for the first option provided.
This is one of the biggest financial decisions you will ever make with long-lasting consequences. You need to ask the tough questions. You not only have the right to shop around for the best solution, but you also have a duty to your future financial self to do so.
Take action:
Acceptance and action run hand-in-hand. You are ready to get to work. Book those professional appointments with debt experts. Put that extra overtime in to earn more money. Do the work.
Soon the financial challenges will begin to get easier.
It’s going to take some time to rebuild, but with a plan in place and a road map for your future you can take back control of your financial affairs. A financial crisis is one of the most teachable moments in our lives and this is the time to learn from the past and to make the changes needed to ensure this doesn’t happen again.
This is your opportunity to keep asking the tough questions in order to understand more than you ever did before about the financial system. You will incur debt again, but it will be with the knowledge to understand the benefits and navigate the pitfalls.
Always remember, no matter how bleak your situation feels, it is absolutely possible to become debt free again. Canada has some of the best solutions in the world to help deal with overwhelming debt.
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